Is it compulsory to tender shares in a buyback if I have shares in my demat account?

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Buybacks are optional. It's shareholder wish to tender or not. It's not compulsory to tender shares in a buyback offer.

In some cases shareholders do not tender the shares in buyback:

  1. When the share price reached close to the buyback price. For example:
    • Xyz company is trading at Rs 75 per share¬†
    • The company come up with a buyback offer ar Rs 85 per share
    • The share price reaches around Rs 85 close to the buyback issue closing date.¬†
  2. The buyback size and acceptance ratio are too small.
  3. Shareholders invested for the long term.
  4. Complicated paperwork for non-individual accounts.
  5. The share prices usually go high after buyback offer.


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